May 10 (Bloomberg) -- Aareal Bank AG, a German commercial-property lender, said first-quarter profit declined 13 percent as the sovereign debt crisis curbed its lending business.
Net income fell to 26 million euros ($33.7 million) from 30 million euros a year earlier, the Wiesbaden-based lender said in a statement today. Net interest income declined 4 percent to 129 million euros, while net commission income in the quarter rose 33 percent to 40 million euros.
Aareal, which provides property financing in more than 25 countries in Europe, Asia and North America, said on Feb. 21 that profit will probably decline this year, while predicting “good potential for achieving consolidated operating profit that is only slightly below” the 185 million euros in 2011. The lender is following “a cautious liquidity and investment strategy” amid Europe’s sovereign debt crisis, it said today.
“We affirm our target for new business of 4.5 billion euros to 5.5 billion euros for the full year 2012, and will exploit opportunities in new lending business more vigorously during the remainder of the year,” Chief Executive Officer Wolf Schumacher said in the statement.
Aareal rose as much as 3 percent and was up 2.3 percent to 13.20 euros as of 9:18 a.m. Frankfurt. The stock has fallen 5 percent this year, valuing the company at 793 million euros.
Aareal Bank tapped the European Central Bank’s three-year loans for about 1 billion euros in February to assure additional refinancing and to boost flexibility, spokesman Peter Alexewicz said in February.
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